>> not in this program. in other programs. >> mr. crane? >> yes. particular the solar project is a huge technological advance. >> mr. mancini. >> the technology was used in the space program but never deployed in a commercial scale project. this gave it the opportunity to do that. i'm happy to report it's operating successfully. >> okay. when we have an isolated look at what the program done, we have testimony that suggests it could be working in which the context it was designed. there are legitimate questions that are raised by dr. derouge about the risk involved. in this case it looks like it might be working.

i think we still need to have caution. i ask unanimous consent moments ago. you made public the e-mail. i have three documents which i would respectly suggest would refute that on engineering assessment by bank of america, two d.o.e. documents. it refutes the allegations that have been made. i ask these be submitted in the record. i appreciate your consideration. >> without objection. mr. crane x i want to put back up this e-mail again. i'm just flabbergasted that we have an e-mail where the ceo of bright source is asking the department of energy to proofread a letter that they're chairman of the board now commerce secretary plans to send

to the white house chief of staff. a couple of the highlighted things. send me comments or suggested ways to improve this message. asking for edits from the department of energy. contained in the draft letter is the statement, dear bill, we need a commitment from the white house to quarterback loan closure between omb and department of energy by march 18th. later on the the draft letter they are asking for edits, they said we need guidance and support from the white house. this takes place in march of 2011. the loan guarantee is approved on april 11th, 2011. were any of those visits during this time frame, the spring of 2011? >> i would think that probably there were some. >> some prior to the april 11, 2011 approval of the loan

guarantee? >> i would think there would be more before than after. >> this project is a big project. this is one big deal to your company and bright source? >> well, mr. chairman, you have to understand two things. this project at that basis, we were involved but it was still bright source's project. number two this may seem like a big deal to you but my focus was on our nuclear project in texas, which was a much bigger project than this. five times larger. >> bright source got billions of dollars. it's not a big deal at all? >> if it didn't happen, we did not invest. bright source was the developer. >> you got an interest. you're partner with bright source. you have pictures of it right here. >> now we are. now we have hundreds of millions invested. as of march or april of 2011, we had nothing. >> it's important now but it wasn't then.

>> it's important to people who developed the project, which is bright source. we had an opportunity to invest. >> it was important enough to bright source to have the department of energy do a, check over they're homework in a letter they were going to send to the white house chief of staff is pretty important, but not important to you? >> at that time, if we had not had an opportunity to invest -- >> just to be clear and just for the record, in any of those seven meetings you had at the white house and some of them taking place in spring of 2011, you did not bring up the project at all in this issue at the white house. >> absolutely not. s >> you didn't know about the e-mail or the draft letter and didn't bring it up at the white house? >> that's correct. >> could we get the second e-mail up just because i want to see this. i want to let the doctor comment on this one. this is an e-mail from prologis

to kimberly at the department of energy. this is going the other way. when you get so close and got to grease the skids of government to debt approval. it seays we have made adjustments. here we now have outside folks, pardon. this is just enter into the record. same thing. glad we're thinking the same. now we have it going the other way around. we have the department of energy having someone private sector edit and draft internal documents that are within the department of energy. if the american taxpayers can see what he is going on in this program. i believe it was your third point, doctor, in your testimony that you talked about this is what happens when cronyism gets to this level and this much

money is at stake. >> when a lot of summon at stake for a company whether it's direct cash or loan guarantees which would give them lower rates than they would get on the open market. it shifts, a lot of incentive for the company to expand a lot of energy than the please the company, to please the government or meet the standards expected by the government. i believe the reverse is true. there's literature all about the way that reverses true. government design programs in order to fet some companies. it goes both ways. >> on one hand we have this company that says edit this for us that the white house is going to send to the chief of staff.

ed did this memo we're going to send to the department of energy. unbelievable. on my time in public office i've never seen those kind of communications going on in are a loan guarantee program or any program. i'll yield now to the gentleman from pennsylvania, mr. kelly. >> thank you. i know this can be uncomfortable. i don't faulyou for taking advantage of a government that continues in this co-dependent type of model. it's sometimes hard to walk away from it once it's there. it's just so easy, why wouldn't we do it. it does come down to what's the return on the investment for the people whose money is at risk? i think that's where the disconnect come because people think it came from the government, it doesn't hurt

anybody. you say where did the government get the money and you find out it's people who actually pay taxes. you find out who pays taxes and you find out not everybody pay taxes. some of us do, some of us don't. for those that do, a lot of people still carry a little lunch bucket. by time they get done paying school taxes, their municipal taxes and state taxes and federal taxes, there's just no money left for them to a take care of their kids and to plan their future. i think that's where the disconnect comes. we start to believe this is free money. it's not free money. this is taxpayer money. how much money did co-gentrix with? >> i'm sorry. i'm not with co-gentrix. >> the federal loan amount was $90 million. >> you know how many permanent jobs that created? >> we created directly

approximately ten permanent jobs. >> ten permanent jobs. not you but you sitting at your kitchen table. i would tell you, we just made a $90.6 million investment. this is all about jobs. this whole initiative was about creating jobs and here is the good news. ten people got jobs. you see any reason why the american people no longer have faith in what's going on in washington, d.c.? the disconnect is so great here. it's so foreign to people who live in this area that money comes out of working people's pockets. it's free. it's not free. this drives me absolutely nuts. can you imagine going to a bank and say i want to borrow $90 million, and i can hire ten people with that. they'd say it's good to see you. please leave. i don't get this. i'll tell you because obviously

you don't know a lot of what's going on. this gentleman, mr. thompson, before he worked for you, he worked for mr. reed. ky anderson is an outside lobbyist for your firm. did you know that? >> yes. >> do you know who he worked for? he was harry reid's deputy staff until 2005. mr. anderson worked for harry reid. is that your husband or who would that be? >> my son. >> he was a donor to the senate reid re-election campaign. there's nothing wrong with this. here is the point. here is my point. this is not to embarrass you. when we follow this judist goat. there are strings attached to this money and we start to

wonder, as i said early this feeding frenzy to come after this money, how in the world did 25 of you get to the table and the others were left out in the cold? you say how did they get there? the guys worked for harry reid and the other guy and all of a suddenhe money starts to flow. people sta to wonder w did it get gamed. this is what theop part of you sitting there. the american people have a right to know how did this happen. >> if i may. >> absolutely. >> i sincerely believe that our project is one of the fit project for

let me ask you. mr. crane, bright source, california valley, solar ranch, project am, where did they sell the power they generate? >> they all sell to california mainly to pacific gas and e lek crick. >> why is that market so strong? >> it has a 33% renewable standard. >> which means what? >> i think by 2020, 33% of the power. >> by government mandate? >> yes. >> the government says you must by this renewable energy. >> state government. >> the market was created by a

government mandate. >> i think it was endorsed by the people. >> i understand that. it was created. it didn't happen in the free market. it was create by a government mandate. you will supply it at this level. the market was created by a government saying this is what you're going to do. you're going to do it with renewable. that's why 1703, did address nuclear. 1705 doesn't. i understand that. you go where the money is. i get it. whent comes down to a government that creates the market rough mandate,that's not the same thing. at the end of the day no matter how much you subsidize it, if it's not market ready, it's not going to float. we create these markets and then we create a business opportunity. i do not fault you for taking advantage of a government that mandate something for people that don't wan it on their own. we forced it down their throat.

they didn't buy it because they wanted to. we create a market and say we're going to create the funding for you to go after it. i get. at the end of the day every single penny came out of taxpayers pockets. funneled through the government. any government spending is flat out taxes. that's all it is. that's all it is. we've lost connection. we have disconnected ourselves with the source. it's hard working american taxpayers. i yield back my time. i appreciate your patience with us. where i come from, these people are struggling. they are out of work. some of them working two and three jobs. moms are trying to figure out what the heck do you do with the money we send you. it just doesn't make sense to the average american. >> thank you. yield to the gentleman from south carolina. >> thank you. i appreciate the courtesy exthe ended to me to participate today. mr. crane, i want to talk to you about the statement towards the end of your both written and

oral testimony, which i think is important where you mentioned that nrg is invested a billion dollars of your own equity in the three projects that we discussed previously. i think the notes said that 400 million of that were in the california valley ranch, the cvsr program. you went onto say that in blunt terms we don't get re-paid unless the government has been re-paid. you hit on an important issue there. a lot of frustration that you hear amongst the panelist today or the members is a reflection of what folks back home are hearing. why are these folks getting paid when they are still on the hook? that's what they saw with fannie mae and solyndra. are you telling us on that $400 million in equity there's no

return on that equity until the debt has been repaid? >> i'm saying in the water fall of payments, the debt service happens before there's any return to equity. i don't know the month on month, year on year but debt has a high priority than equity. >> you say the debt service is above the equity on the water fall. what about the repayment of the principal of the loan? >> that service is interest plus principal. >> okay. y'all collect fees and management consulting fees? >> operating fees. operating fees are pretty small because there's no moving parts. operating fees for any project go above debt service. you have to keep the projebt operating. >> i have no difficulty with that. is there any debt? have the owner of the company

extended any debt to this cvrs program? >> no. >> it's just equity? >> we don't put debt in any type of project. we're not debt providers. >> what are the repayment terms? how long will it take to repay the $1.2 billion government loan? >> i should know but i don't know the term of the repayment on the projects. usually the debt is tied to the length of the power purchase agreement. these are 20 and 25 year power purchase agreements. >> that would make sense. i don't know the specific terms of this but they would be tied to the agreement. you have the agreement to sell the electricity to the providers. >> usually the debt ends before the power stream. >> here is what i'm struggling

with. we don't get repaid unless the government gets repaid. the taxpayer will be on the hook for something for the next 20 to 25 years. you made a statement saying your company would get all of your capital back in two to five years. >> do you want me to explain that? >> that's what i'm asking you. yes, sir. >> that statement which was later taken out context by the new york times by a project called blightth. >> it's your testimony there will be no return on equity and no return of equity on the cvrs program until after the loans are paid in full? >> i would have to see the profile. i'm not saying exactly that. no project if you said equity, we're not going to give you a dollar back for 20 years, there's never going to be equity in a project. what i'm saying is the debt service under the terms of the

loan will be serviced before any money can come out as we call in the business, out of water fall. debt gets repaid before equity. >> i understand that. when you tell me the debt will get serviced before there's ane the debt will be repaid. >> that's probably correct. >> you will get repaid, at least something on that equity before the taxpayer is completely off the hook? >> i'm sure we'll get some income before the debt is fully off the books. >> thank you. >> mr. crane were you taken out of context in the new york times piece. like i've never seen anything in the 20 years that involved less power. was that in context or out? >> that's in context. i believe -- >> you intend to do as much of your business that you get your

hands on? >> keep in mind we're talking about a company that's trying to build a nuclear power plant. i would say that the ground mounted in the california desert is about the least risky project you can do in the power industry. >> okay. >> that was not taken out of context. >> i want to be clear which is in context and which is out. to your knowledge before you got any, before you got the loan guarantee, did the d.o.t. share any documents with you or representatives of your company? >> i'm not sure i follow. what types of documents would you be referring to? >> any documents. i put up the one e-mail where you got to edit, does drew work for you? >> he works for our company. >> does jonathan plow work for your company? >> no, he does not.

i believe he works for bank of america. >> drew torbin does. >> you got to edit an internal memo. i want to know did they share any internal documents with you? >> i don't know. i was not involved in the negotiations. i would say we were completely transparent with the d.o.e. as to the situation that was evolving at that point in time as it relates to solyndra. we wanted certain documents, in the final loan document we wanted them to acknowledge that. there was back and forth that took place and that's not unusual. >> you don't think it's unusual? >> i don't. >> that someone from your company gets to edit an internal memo and what will be distributed to department of energy employees? >> i don't think it's unusual given the back and forth that needed to take place before the loan document was signed that there would be back and forth conversation editing in the like

that needed to take place between the parties. >> you did not participate in any of that back and forth? >> i did not. >> you didn't participate as the ceo? >> i was not ware of it at the time. >> let me show you another e-mail. we have another one that astounds me. this is from mr. peter roarke to the department of energy and drew torbin who work frs you. it sends please do not send beyond the two of you. feel free to use the concepts that we articulate if you don't already have this in your message. that refers to, can we put the next light up to. i don't know if we can put that one, but refers to project am, project energy document that they'll send to you with all kinds of information that you can use in your presentation. let's think about the way, i think the american citizen see this. this is like the teacher telling

two of the students, not the whole class, here is what's going to be on the test. don't send beyond the two of you. don't tell anyone else we're giving you the answers to the exam and you say, that's fine. that's the normal course of business back and forth? you didn't have any knowledge as the c kerks o of the company? is. >> i think as it relates to what was sent, which was the presentation. >> mr. crane did you get that treatment? did you get internal documents fwr the department of energy saying if you say things this way, you're more likely to get billions of dollars in guaranteed loan? did you get that privilege? >> i've never seen the department of energy internal memorandum. >> did you get there special treatment? >> not that i'm aware of. >> you don't know of anyone to get internal documents of? >> not that i'm aware of.

>> doctor does this seem unusual to you or this is par for the course when you decide you're going to have this in government. >> i'm not entirely surprised. i don't know this particular case. >> do you think it's unusual? torbin is the one that works for you. he's a great guy. >> chairman, i don't think that sending a presentation as to what project amp is about. that is our project. sending the presentation, i don't see as being unusual, no. >> feel free to use the concepts that we articulate in your own words.

this is certainly intellectual. send it this way, you have higher chance of getting it approved. >> i haven't seen it. >> this is why we have had several hearings. 26 companies got taxpayer money. we're in this loan guarantee. 22 of them had credit ratings of double b minus. most of the companies who got money, a significant number, had strong connections to the obama administration either during the campaign and in bright source case, the chairman of the board became commerce secretary shortly after they get the loan approved. we see all this and now we have e-mails going back and forth saying say it this way. edit this letter that we want to send. when you put it in the big picture, no wonder the taxpayer is saying what the heck is going on with our government. this is not the way it's supposed to work. it's so frustrating to look at this is what's going on.

the department of energy where they are picking the winners and losers. hundreds of companies applied. 26, 26 got the $15 billion. such a deal. such a deal. you think this is, in your words, you think this is customary in the way it's supposed to work. >> what i said, mr. chairman, i said sending the presentation on our exact project what we're working on doesn't seem unusual to me, no. >> doesn't seem p unusual that the department of energy says this is how you need to say it. here is the answers to the test. that's not unusual? >> i couldn't read the e-mail. >> please do not send beyond two of you. this is very important. feel free to use the concepts that we articulate in your own words. feel free to plagiarize. that's what it says. >> it's a presentation that is about our project. going back and forth on a

presentation that ultimately we will use or somebody will use in the future just doesn't, i don't understand the context of why this was sent. >> did you have any communication with the department of energy? >> i did not. >> you didn't talk to mr. o' rourke? >> no. >> did you make any trips to the white house? >> no. >> did you talk to anyone in the administration? >> no. >> mr. biden? >> no. >> you got a little different treatment than mr. crane. i yield to the gentleman from the ranking member from ohio. >> thank you very much. i want to go back to the e-mail that you discussed. goes right to bank of america because the only party to this e-mail that is not provided

public testimony in its loan program is bank of america. the impact and import of this particular memo which you've sited as matter of concern, we really don't understand it until we get bank of america's perspective. i would just like to ask my friend if there's way that you and i could work together to that they be invited to come in and explain their point of view about this. could we see if we could work together. would you consider? >> definitely consider that. that's something we need to think about.

>> in listening to this discussion and my friend, mr. kelly, has a way of continuing to hammer home about the benefits that are going to some at the exclusion of others. that's a valid question. always is in this town. as you were talking x one of the things that occurred to me about this plar model in this discussion we're having, just to look at it from a different level. this is all about centralization of power literally. we could have a different model. we could be investing in decentralization of power, getting more people involved in manufacturing micro technologies, but when you have a centralized government and a centralization of power on business part, you put those two things together, there's a different philosophy at